Sales up at Mosys, but CEO is cautious

SUNNYVALE, Calif. --- Memory designer Monolithic System Technology Inc. (MoSys) made a net profit of $2.7 million on sales of $7.9 million in its first quarter ended March 31. Although sales were up, profits were flat and Fu-Chieh Hsu, chief executive of Mosys, said he has recently seen an unseasonal dip in customer activity.

Total net sales revenue was up 23 percent from $6.4 million in first quarter of 2002 and comprised $4.5 million from licensing, $2.9 million in royalties and approximately $544,000 in product revenue. The net income was slightly down from $2.8 million in the same period last year. But licensing revenue was up 137 percent compared with same quarter a year before.

"Although we continue to see strong interest in our technologies, we cannot predict the pace or speed at which our customers will commit resources to new project design," said Hsu in a statement.

"Recently we have begun to see more than the normal seasonal dip in new project initiatives and production deployment. We believe this to be a result of the budgetary decisions made by our customers as they are applying even greater caution to their research and development projects in the midst of prolonged economic uncertainty.

"As a result, we are becoming increasingly cautious as we formulate our quarterly guidance.," Hsu said.